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Red Lion Senior Home residents and volunteers aren't big fans of the federal government after Thursday's announcement.

There will be no benefit increase next year for millions of Social Security recipients, disabled veterans and federal retirees, the government said Thursday.

It's just the third time in 40 years that payments will remain flat, and all three times have come since 2010.

Linda Hivner, who's lived in the Red Lion area all 68 years of her life, said the lack of an increase is going to hurt seniors on a fixed income such as herself.

"Social Security is my income," she said.

Prices: The main reason for no increase next year is low gas prices.

By law, the annual cost-of-living adjustment, or COLA, is based on a government measure of inflation. That gauge came out Thursday, according to AP reports.

As of Wednesday, AAA said the average price of a gallon of regular gasoline was $2.30, about 90 cents less than it was a year ago.

Manu Patel, a 69-year-old volunteer at Red Lion Senior Home who lives in Windsor, said he doesn't drive much, though.

"People aren't drinking gas, but they are eating food," he said, pointing to rising grocery prices.

Jake Epstein, a 76-year-old volunteer at the center, echoed Patel's sentiment, arguing the government is clearly not paying enough attention.

"Tell them to go to Giant some time and tell me cost of living isn't going up," Epstein said. "It's so hard to live on Social Security unless you and your wife had a good job, but not everyone — including myself — is that smart. A lot of people in here wouldn't be getting a good meal every day if it wasn't for the senior center."

In addition to rising food costs, Epstein said he's noticed recent increases in auto repairs, general services, clothing and medicine.

Benefits: The lack of a benefit increase means that many older people could face higher Medicare costs, an issue that has advocates lobbying Congress, according to AP reports.

Increasing costs of Medicare had already forced Epstein and his wife onto a minimal-benefit health insurance plan, he said. He recently went through a series of kidney stones that had originally been billed to him for $61,000 before he was able to convince his provider to reduce the costs to monthly installments totaling $12,000.

The government's announcement will affect benefits for more than 70 million people, more than one-fifth of the nation's population.

Almost 60 million retirees, disabled workers, spouses and children get Social Security benefits. The average monthly Social Security payment is $1,224.

The COLA also affects benefits for about 4 million disabled veterans, 2.5 million federal retirees and their survivors, and more than 8 million people who get Supplemental Security Income, the disability program for the poor. Many people who get SSI also receive Social Security.

Increases: Congress enacted automatic increases for Social Security beneficiaries in 1975, when inflation was high and there was a lot of pressure to regularly raise benefits. Since then, increases have averaged 4 percent a year.

But in the past decade, the COLA has been that big only once. Advocates for seniors told the AP that years of small increases or no increase are eroding the buying power of benefits, regardless of the official inflation numbers.

Social Security is financed by a 12.4 percent tax on wages up to $118,500, with half paid by workers and the other half paid by employers. The amount of wages subject to Social Security taxes usually goes up each year. But because there is no COLA, it will remain at $118,500 next year.

The cost-of-living adjustment is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W, a broad measure of consumer prices generated by the Bureau of Labor Statistics.

Comparison: The COLA is calculated by comparing consumer prices in July, August and September each year with prices in the same three months from the previous year. If prices go up, benefits go up. If prices drop or stay flat, benefits stay the same.

The CPI-W numbers for September were released Thursday, providing the last piece of the puzzle.

The September numbers show that gasoline prices are down by 30 percent from last year. Airfares have fallen by 5.9 percent and clothing prices are down by 1.3 percent.

But other prices are up. For example, medical care has risen by 2.4 percent, housing costs climbed by 3.2 percent, and food prices were 1.6 percent higher.

Advocates say the government's measure of inflation does not accurately reflect price increases in the goods and services that older people use.

— The Associated Press contributed to this report.

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